But now ask the question: what would the effect be if China decided to sell a chunk of its Treasury bill holdings and put them in other currencies? The answer is that China would, in effect, be engaging in quantitative easing on behalf of the Fed. The Chinese would be doing us a favor! (And doing the Europeans and Japanese a lot of harm.)

Conversely, by continuing to buy dollars, the Chinese are in effect undermining part of the Fed�s efforts � they�re conducting quantitative diseasing, I guess you could say, hence the title of this post.

The point is that right now the United States has nothing to fear from Chinese threats to diversify out of the dollar. On the contrary, if the Chinese do decide to start selling dollars, Tim Geithner and Ben Bernanke should send them a nice thank-you note.

Here are some excerpts from what this influential conservative wrote (I have taken the liberty of bolding the most important lines):

�The president will lobby intensively for his plan. It will surely be the central theme of his State of the Union Address in January. Health care reform remains popular in principle. And the Democratic Party has the votes�

�Any Republican urge to negotiate a �least bad� compromise with the Democrats, and thereby gain momentary public credit for helping the president �do something� about health care, should also be resisted. Passage of the Obama health care plan, in any form, would guarantee and likely make permanent an unprecedented federal intrusion into and disruption of the American economy�and the establishment of the largest federal entitlement program since Social Security. Its success would signal a rebirth of centralized welfare-state policy at the very moment we have begun rolling back that idea in other areas�

�But the Obama proposal is also a serious political threat to the Republican Party. Republicans must therefore clearly understand the political strategy implicit in the Obama plan�and then adopt an aggressive and uncompromising counterstrategy designed to delegitimize the proposal and defeat its partisan purpose�

�If an Obama health care plan succeeds without principled Republican opposition� its passage in the short run will do nothing to hurt (and everything to help) Democratic electoral prospects in 2012. But the long-term political effects of a successful Obama health care bill will be even worse�much worse. It will relegitimize middle-class dependence for �security� on government spending and regulation. It will revive the reputation of the party that spends and regulates, the Democrats, as the generous protector of middle-class interests. And it will at the same time strike a punishing blow against Republican claims to defend the middle class by restraining government.�

It�s revealing stuff: We better stop health care reform because, if the Democrats pass it, the middle class is going to like it, and our anti-government ideology will be discredited. I couldn�t agree more.

Okay, now that you�ve read the above, I have to confess to a lie. The above excerpt is authentic, except for the fact that I have changed the word �Clinton� to �Obama� and �1996� to �2012.�The excerpts above come from a famous � perhaps infamous � call to arms written by conservative operative Bill Kristol in 1993 when Bill and Hillary were pushing their failed effort to reform health care.

Overall, the government is inept at predicting healthcare spending. When Medicare was created in 1965, the government estimated that the cost of the program would be $12 billion by the year 1990. In actuality, the program cost $110 billion in 1990, and to date costs $500 billion. Also in 1965, Medicaid was created and was expected to cost $1 billion annually, but has developed into a $250 billion program.

If the CBO estimates are as inaccurate as predicted and this legislation is enacted, the stability of the American economy faces irreparable damage.

Democrats said they would vote Sunday on the Senate bill and on revisions to it included in a budget reconciliation measure.

Democrats said the outcome would be the same: the Senate bill would be sent to Mr. Obama, who would sign it into law, and the reconciliation bill would go to the Senate, which could take it up within days.

At the Capitol rally with Mr. Obama, the Senate majority leader, Harry Reid of Nevada, assured House Democrats that their Senate colleagues would act quickly on the reconciliation bill, including final revisions to the health care measure. �I have the commitments of a significant majority of the United States Senate to make that good law even better,� he said.

Republican Rep. Jean Schmidt said an executive order "is not worth the paper it is printed on."

"It is not the law of the land and it can be rescinded in the blink of an eye," she said.

There is a tendency to think this sort of inane hyperbole an innovation of our polarized age. But it isn't. When Medicare was being considered, the American Medical Association hired Ronald Reagan to record a record housewives could play for their friends. It was called Operation: Coffee Cup, and you can listen to it in the clip atop this post, or read the text here.

Reagan was a more graceful speaker than Blackburn, but his point was much the same. Kill the bill. "If you don�t do this and if I don�t do it," he said, "one of these days you and I are going to spend our sunset years telling our children and our children�s children, what it once was like in America when men were free.�

Well, the bill passed. And moments ago, Rep. Paul Ryan was on the floor of the House, bellowing against Democrats who would dare propose "across-the-board cuts to Medicare." This is breathless opportunism from Ryan -- he has proposed far deeper across-the-board cuts to Medicare, and is making arguments against the Democrats' bill that would be far more potent and accurate if aimed at his own -- but leave that aside for a moment. The GOP's embrace of the program that Ronald Reagan fought, and that Newt Gingrich sought to let "whither on the vine," is based on the lived experience seniors have had with the bill: It has made them more, rather than less, free.

Tea partiers and other anti-health care activists are known to get rowdy, but today's protest on Capitol Hill--the day before the House is set to vote on historic health care legislation--went beyond the usual chanting and controversial signs, and veered into ugly bigotry and intimidation.

Civil rights hero Rep. John Lewis (D-GA) and fellow Congressional Black Caucus member Andre Carson (D-IN) related a particularly jarring encounter with a large crowd of protesters screaming "kill the bill"... and punctuating their chants with the word "nigger."

Standing next to Lewis, emerging from a Democratic caucus meeting with President Obama, Carson said people in the crowd yelled, "kill the bill and then the N-word" several times, while he and Lewis were exiting the Cannon House office building.

"People have been just downright mean," Lewis added.

And that wasn't an isolated incident. Early this afternoon, standing outside a Democratic whip meeting in the Longworth House office building, I watched Rep. Barney Frank (D-MA) make his way out the door, en route to the neighboring Rayburn building. As he rounded the corner toward the exit, wading through a huge crowd of tea partiers and other health care protesters, an elderly white man screamed "Barney, you faggot"--a line that caused dozens of his confederates to erupt in laughter

It all comes down to this: the reconciliation bill before Congress sets the penalty for failing to buy individual insurance in 2014 at $95 or 1 percent of annual income, whichever is greater, rising to $695 or 2.5 percent by 2017. (Those earning less than 300 percent of the federal poverty line face flat dollar figures, those above, percentages of income.)